Europe has spent years talking about digital sovereignty but now, the money is beginning to follow…
Reports that Samsung is in talks to invest up to €1bn in French AI company Mistral have added another development. According to Sifted, the South Korean company is in talks to back Mistral’s latest fundraising round, which is reportedly seeking €3bn at a €20bn valuation.
Mistral launched in 2023 as a European alternative to large AI model developers in the United States. If the investment goes ahead, it would hand the French company more than funding. Samsung is one of the world’s biggest memory chip makers, making the talks interesting for anyone watching Europe’s ambitions to build its own AI ecosystem.
Is Europe Becoming More Serious About Sovereignty?
European sovereignty has grown well beyond politics. AI, semiconductors, energy, defence and pharmaceutical production have all become areas where European governments want less dependence on technology developed elsewhere.
Ashish Patel, Managing Director in Houlihan Lokey’s Capital Solutions Group, believes that thinking is beginning to influence where investors place their money.
“Increasing pressure from European governments is driving the agenda around European sovereignty, including efforts to reduce dependency on critical technologies that have historically been supplied by the US and China. This is particularly relevant in areas such as AI, which is expected to power the ‘economies of the future’, alongside other strategically important sectors including defence, energy and pharmaceutical production. We are seeing a growing recognition among investors that Europe has the potential to become a more independent technology market, capable of supporting scaled AI businesses serving European customers.”
His comments come as Europe is more willing to back companies that want to compete directly against American and Chinese AI developers rather than simply buying their products.
Patel added, “Companies such as Mistral and Lovable have been vocal about the importance of sovereign European technologies, and this shift in market sentiment is increasingly being reflected in capital allocation decisions.”
So, Where Is The Money Going?
Investor interest is no longer limited to AI chatbots or software applications. Investors are also putting money into the infrastructure needed to build AI.
Patel said, “Importantly, investor appetite is extending beyond application layer AI businesses into the wider ecosystem required to support the technology, including data centres, semiconductor companies and other elements of critical AI infrastructure.”
More from Artificial Intelligence
- Will The EU’s Mandatory AI Watermarks Actually Stop Deepfakes?
- What’s The Difference Between Open Weight And Open Source AI?
- NVIDIA’s AI Tool Can Spot Deepfake Videos – Is The Company Starting Too Many Projects At Once?
- Frontier AI Or Budget Models – Which Strategy Makes Sense For Your Business?
- Nvidia Has Its Own AI Model – How Will This Affect Competition In The Industry?
- AI Is Supposedly “Replacing” Writers. So Why Is Anthropic Hiring Editors For $295,000 A Year?
- Should AI Literacy Be Taught Alongside Math And English?
- Should AI Have An Appreciation Day When Other Industries Don’t?
AI requires far more than clever software. It needs powerful chips, data centres and enough computing capacity to train increasingly complex models. Samsung’s position as one of the world’s largest memory chip producers makes its reported talks with Mistral particularly interesting.
Sifted reported that Swedish investment company EQT is also in talks to lead or co lead Mistral’s Series D through the Scaleup Europe Fund, a €5bn fund launched by the European Union last year to tackle the shortage of late stage funding in Europe.
The fundraising would also continue Mistral’s rapid expansion. According to Sifted, the company has already secured more than $3.5bn through debt and equity. Less than a year ago it completed a €1.7bn Series C led by Dutch semiconductor equipment manufacturer ASML.
Can Europe Build AI Champions?
Europe’s AI companies are competing in a highly competitive market. OpenAI and Anthropic continue to secure enormous funding rounds, and Chinese AI developers are also expanding rapidly.
According to Sifted, Anthropic recently secured $65bn in Series H funding at a $965bn post money valuation. A month earlier, OpenAI announced a $122bn fundraising round at a $852bn post money valuation. Those sums show the financial firepower European companies are competing against.
Patel believes investors are beginning to think differently about Europe’s technology sector.
“As belief builds in the long term viability of these businesses, we are seeing increased competition for rarer, scaled assets, which is driving valuations. We are also seeing growing demand for secondary positions in these companies, creating potential liquidity opportunities for employees and early investors, which once realised, can help to drive positive reinforcement to the thesis around value creation and crystallisation in Europe.”
He believes pension funds and institutional investors could become an important source of funding as Europe’s tech plans grow.
“Ultimately, greater allocation of capital from pension funds and other large institutional investors into European technology has the potential to generate attractive returns for investors while supporting the development of a more independent and resilient European economy.”
Samsung’s reported talks with Mistral do not answer every unknown about Europe’s AI ambitions but what they do show is that sovereignty is becoming more than a political slogan. Investors are treating it as an investment priority and Europe is backing companies that want to build AI on its own terms.
